How Does Flood Insurance Work?

Flooding, which is something capable of bringing serious damage and even total destruction to your home and possessions, is one peril not covered by most standard homeowner's insurance policies. Flood insurance is a specialized type of coverage that's provided through the NFIP, or National Flood Insurance Program, which is run by the FEMA, the government's Federal Emergency Management Agency. The program has been in place since 1968 when it was officially authorized by Congress.

Flood coverage policies are sold and administered by professional insurance agents like Tom Needham Insurance and cannot be purchased directly from the NFIP, although annual premium payments are made to FEMA. Coverage is available nationwide, with average costs running just slightly less than $600 per year, although properties located in high risk areas will experience significantly higher rates. Total annual premium amounts are required to be paid up front. 

Flood Insurance Particulars

Some home and business owners are required to have flood insurance, while for others it's optional. The NFIP has mapped out sections of the country according to perceived flood risk levels, and those living in high-risk areas, designated as a Special Flood Hazard Area (SFHA), are required to be covered if they have a mortgage loan from a federally regulated/insured lender. Those living outside designated SFHAs are still eligible to purchase the coverage and, typically, at lower, preferred rates.

Policy limitations for homeowners are $250,000 for structural damage and $100,000 for contents. Renters can be covered for up to $100,000 in losses of personal property. Non-residential (commercial) property has coverage limitations of $500K for structural damage and $500K for contents. After coverage is purchased, there's a 30-day waiting period before the policy goes into effect. There are a few exceptions to this, all explained on the NFIP's website.

Local Problem Areas

While most of the Greensboro and High Point areas are rated as minimal risks for flooding, recent heavy rains have been responsible for causing problems in many areas such as around the High Point Regional Hospital on Elm and areas around Main and Bus. 85. Properties around High Point Central High on Ferndale also typically see high or standing water problems in response to heavy rains such as have recently been experienced.

The Latham Park section of Greensboro also typically floods after heavy rains due to the proximity of North Buffalo Creek. There are other areas at risk. You can check your flood risk level right here.